About this template
Inspired by @Hans, I've been playing around with some UVXY Short Call strategies that can be botable on OA, without being overly complex.
This is the first one I'm comfortable sharing after a couple of weeks of live trading, though it's still very much a WIP (and much of the risk management is still being done manually).
Strategy:
Wait for UVXY spikes, enter weekly short call spreads, and hold / roll until they expire OTM (for now, just taking 50% PT, but goal is to eventually let them expire worthless)
This strategy benefits from UVXY's systematic decay (beta slippage + futures contango) as well as theta decay (ATM short spreads).
Entry:
Is UVXY elevated 20%+ from a recent low? (can't check all-time-low within OA, so I checked every date available within the recipes, which should be close enough)
Is UVXY not down today? This is designed to allow a 1st position to enter on UVXY "flat" days, as long as it's still elevated from a recent low and there's some beta slippage and theta decay to capture.
The bot latters into a total of 3 positions, where the 2nd enters if the 1st is challenged up to the next available strike (.50 cent increments), and the 3rd enters if the 2nd is challenged up to the next strike.
Example:
Position 1 Enters with ATM short call at 5.50
Position 2 Enters if UVXY reaches 6.00
Position 3 Enters if UVXY reaches 6.50
Position:
4-7 DTE ATM Short Call Spreads, $6 wide (so roughly "insured" for spikes above 100%)
Exit:
50% Exit Options, or roll perpetually if that target is not reached
Risk Management:
The risk management of this strategy isn't fully baked in within the bot, and is a work in progress. The bot assumes positions will be rolled perpetually, and that capital will be available to support that. I'm managing assuming a 100% UVXY spike at some point, though 200% and above are certainly possible. Position size accordingly so you can roll perpetually until the new all time low, or hedge with shares.
